What the hell is this despite?

London property developers last year sold more than twice as many two-bedroom apartments costing between £650,000 and £1m as cheaper homes priced at about £300,000, according to market data obtained by the Guardian.

Figures gathered from more than 600 new housing projects in the capital reveal a spike in the number of homes sold to the richest househunters, despite the fact that many young people complain of being priced out of the housing market.

Surely* it’s “because”?

Yes, yes, yes, Mr. Venning said that the answer to any question beginning “Surely” is “No” but still……

19 thoughts on “What the hell is this despite?”

  1. Actually the causation is the wrong way round. Young people are priced out of the market *because* the developers are able to sell homes to the mega-rich.
    The whole “priced out of the market” bit is an automatic consequence of the shortfall of supply below demand. Scrap planning rules (especially the Attlee one on housing density per acre) and house prices will gradually return to normal.

  2. So as a business owner I have x amount of y(in this case land) to sell. I can do the minimum required to provide safe housing and make a little bit of profit or I can add some shiny tat, sell it as a luxury, and make a much bigger profit. Since any successful business owner will go for the larger profits it appears the market is working the way it should. Pricing first time homeowners out of the market is just a side effect.

    @john77
    I don’t understand London real estate well enough to be able to comment on the Attlee rules you site. What was the original purpose of the housing density regulation? What other planning rules(I am assuming these are what we call building codes) should be removed to reduce lower end housing prices without massively degrading housing safety?

  3. The thing that’s being more talked about is “planning permission” “Zoning” in US speak. There’s vast areas of land, even in London, that could and can be built upon: except for the permission to build upon them.

  4. @Liberal Yank
    I think around 3% of the USA land area is designated as National Park. In the UK, although not directly equivalent, it’s about 10%. Add in AONBs, Green Belt, SSSIs, NNRs, Heritage Coasts and about one-third of a million listed buildings then about 40% of the land area has some special protected status. And that’s before you get to the Royal residences, scheduled ancient monuments and battlefields, National Trust, and UNESCO World Heritage sites, and a bit of land for the military to play with ( some of this overlaps ).
    Then we have organisations like the Campaign to Protect Rural England who object to development outside these special areas if it’s visible from within the special area.
    Then you’ve got the National Planning Policy Framework which says in my village 3 new houses can’t be built on an otherwise boring field because they are not ‘sustainable’ in terms of travel – being more than 400 metres from a bus stop. And rules saying for example that 10% of any development has to be ‘affordable’, meaning the developers have to take a loss on those units passed to housing associations paid for by higher prices for people buying with their own money.

    And in our most populous city you can’t build high rises anywhere west of Hammersmith it seems.

    This post contains ranting, and may include factual omission and inaccuracy, but you get the idea.

  5. Bloke in Costa Rica

    Well, quite. There’s an enormous desolate patch of waste ground between Primrose Hill and Marylebone just sitting there, for example. You could house fifty thousand people on the site.

  6. Thank you for the information.

    It would appear that protecting history is one of the largest problems. I think that most people would agree that demolishing Shakespeare’s home or Bletchly Park for mcmansions would be a great loss. The question is where to draw the line. What are the current proposals for amending the protections that would allow the majority of important sites to be saved while freeing up new land for development?

    I consider myself to be close to the bus stop at this point. I’m going to guess that it is between 1000 and 2000 metres from my house without actually measuring. Would it be a safe guess that the 400 metre mark was set by someone who has lived their life entirely in the city without regard to less densely populated areas?

    The 10% affordable housing requirement is something I’d be interested in learning more about. I don’t think anyone wants to see their barista having to travel 30 miles just to make coffee yet they don’t want to live next door to them either. Does this particular law lead to more income diversity in individual neighborhoods? What is the total cost to developers? Is there a proposal that would enable mixed income neighborhoods at a reduced cost?

  7. @ Liberal Yank
    The original purpose was to prevent developers building houses too small and too close together like Victorian slums. The persons who wrote the regulations omitted to consider the possibility of flats (“apartment blocks” in American). So all the tower blocks built by the Wilson government had to have vast empty spaces around them. So we have millions of people commuting into London to work because they cannot live close enough to their jobs to walk while Ponders End has acres of empty space around its tower blocks which cannot be used for housing and aren’t used for anythying else. [Some are Designated Children’s Play Areas where there are no children]. There are some ridiculously expensive tower blocks being built/recently completed in the City of London because they are surrounded by offices (plus a few shops and railway stations) so they are permitteds by the regulations while council flats for the poor in residential suburbs are forbidden.
    “What other planning rules(I am assuming these are what we call building codes) should be removed to reduce lower end housing prices without massively degrading housing safety?” All of them. David Cameron tried to relax planning rules in 2010 by saying “it should be OK if the local community agrees to it” but he was shouted down by interested parties and his political opponents saw an opportunity to humiliate by backing the planning bureaucrats who have their own little empires – big housebuilders need to have a stock of development land equivalent to four years’ building because it takes that long to get planning permission and actually build the houses with all the extras demanded by the planners as a condition of obtaining planning permission. House improvements are supposed to be approved by the committee of local councillors but the planning bureaucrats sometimes choose to change things after their so-called masters have given their verdict. If you’ve got a few £million to spare you can fight them but normal people will go broke and/or die of old age taking it through the courts.

  8. Taking an easy example, religion is something the UK does not do well. No major religion has begun here. Several hundred years ago we upset the papacy and founded a cultish off-shoot called the Church of England whose only virtue now is that it is for people who believe in being nice to poor people but don’t believe in God. If you wanted to take religion seriously you got on a boat to Ulster or even better to the United States of America, hell yeah.
    But in round numbers we have 100k listed buildings of a religious flavour, many of which are closed, even ruined. Give me a grant and the right team I could distil that down to the best 10k for you.
    We’ve got nearly 300 old-style town centre cinemas which are listed, and applications for more to be preserved. Sorry, I know some people remember snogging in the back row of a double feature, but 100 of these buildings is surely enough.

    Post contains drunken invective, and may lack accuracy, but you get the idea.

  9. We have a similar green space requirement here. It depends on the building but for a typical single family home there must be at least 10 feet of space from the property edge to the building. There is an empty lot across the street that is 30×165 feet. Due to the law no one will bother to build on the lot as no one wants a house that is only 10(about 3 metres) feet wide. I offered a small amount so I could plant some fruit trees and a garden but the city wants more than I paid for my house for the empty lot.

    Your suggestion is to remove all of the planning requirements. Does this include the building codes for things such as stub spacing? If so are you prepared for the return of tin roofed shacks? One obvious problem I can see is that the reduction in electrical standards would result in a much higher number of fires. Can the NIS and fire departments handle the increased load from these new, but currently substandard, structures? As the value of these properties will be very low where will the taxes come from to pay for these services?

  10. @ Liberal Yank
    Housing safety in this country is covered by other rules, so would not be noticeably affected by the abolition of planning controls. Planning controls only affect new building/extensions/changes whereas safety rules cover existing buildings as well.
    No-one in the USA would want a building 10 feet wide – a few years ago someone bought a broom cupboard in west London to sleep in. That is what we get from planning restrictions!

  11. @ Andrew Carey
    If you don’t believe in God, what is the point of being nice to poor people? Go and ask your Vicar: if who know who he/she is…
    God instructs us to be nice to poor people.
    A couple of centuries ago people attended their parish church because it was the “done thing” – not any more. The CofE now comprises people who do believe in God, plus a handful of non-believers who attend because they want to have a wedding or Christening in the church building.

  12. @john77
    We have run into the problem of having slightly different systems. At least I know understand what is considered a planning code now.

    Actually many people in the US life in single wide trailers which I believe are 8 ft. Whether they want to or not isn’t really an issue. What really matters is that because of the green space requirement I could only build on less than 1/3 of the property.

  13. Planning Permission and Building Regulations are two entirely separate systems. Enough has been said upthread about PP. Building Regulations used to be entirely sensible and practical but now we have part M (everything needs a bloody wheelchair ramp), part L (eco bollox), part P (Lord Finchley tried to mend the Electric Light/ Himself. It struck him dead: And serve him right!/ It is the business of the wealthy man/ To give employment to the artisan.)

  14. Make building regulations optional.

    If the builder thinks they are useless and abides by his own set, or some devised by a private organisation like veritas for example, then its up to the buyer to decide if its good enough for him.

    The resulting demand for regulations will make sure that only those which are deemed useful will be quickly arrived at.

    In short, get the fucking government out of the equation altogether.

  15. Meanwhile in the real world, the UK government (serving the Tory or landed interest) has realised that, if you let market forces decide what’s built, the cartel of major building firms just buys loads of land with extant planning permissions but does n’t build anything on it because their ensuing artificial scarcity puts up average house prices. So the Tories now propose to intervene in the market in a very non Tory way and sell any land they own only to very small building firms who will break ranks with the cartel and actually build houses and sell them.
    The squealing above is the death pangs of a totally corrupt system that makes houses in London sell for £Im a pop so ruining the economy in the way Henry George indicated.It also ruins the democratic system because all parties (not just Tories) bribe homeowners with unearned, untaxed capital gains in their property values while real earnings are allowed to drift down .

  16. DBC Reed is, as usual, living in an alternate universe.
    Saturday’s FT article reporting Cameron’s move mentioned that nearly half of all land suitable for developmenmt is held by the public sector. It is the public sector, not the housebuilders that has been sitting on land. The collapse in housebuilding had been under New Labour from 2007 to 2010. Under the Coalition and the Conservatives, private sector housebuilders have, contrary to DBC’s smear, increased output above the 2010 level. http://content.knightfrank.com/research/297/documents/en/2015-2852.pdf

  17. @j77 Great big ranting lies. This is how the Coalition looked back on its years of “increased output” in housing
    The Times 2.xii.14 headline “If builders won’t build we will”

    “Thousands of home are to be built directly by the government for the first times in decades to help ease the housing crisis. Under plans announced by Danny Alexander today , a government quango would commission, build and sell houses on the open market keeping the profits to pay for further homes.
    The Chief Secretary to the Treasury warned developers “If you don’t build we will” as he gave details of a plan to build 10,000 homes at Northstowe the former RAF base in Cambridgeshire’
    He formally apologised to all the nasty fuckwits whom the Conservatives had conned into believing that market forces would build all the houses by magic.”
    OK I made the last sentence up but not the rest which marks the beginning of the end of the fond fantasy that everything will appear at the touch of the Market forces fairy’s magic wand .Just like flood defences .

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